Industrial-organizational psychologists use their understanding of psychological principles to better organize work spaces. While most types of psychologists need a doctoral-level degree to legally practice, industrial-organizational psychologists can work with only a master's degree. However, salary surveys conducted by the Society for Industrial and Organizational Psychology demonstrate that industrial-organizational psychologists with a PhD enjoy higher pay.

Starting Salaries

According to the Society for Industrial and Organizational Psychology, I/O psychologists with a master's degree reported an average starting salary of $65,521 per year as of 2012. By comparison, those who began their careers with doctoral degrees reported an average starting salary of $81,815, over $16,000 more than those who held a master's.

Average Salaries

As of 2012, female industrial-organizational psychologists with a doctoral degree earned an average of $117,936 per year, significantly more than the $83,562 averaged by their counterparts who held a master's degree. Male I/O psychologists with a doctorate reported an average salary of $141,549 per year. Again, this was significantly more than male I/O psychologists who held just a master's degree, who earned an average of $101,003 per year.

Pay by Experience

In 2012, I/O psychologists who held a doctoral degree earned an average of $95,743 per year with two to four years of experience, according to the Society for Industrial and Organizational Psychology. This rose to an average of $120,546 for those who had between five and nine years of experience, and to $ 131,788 for those with between 10 and 14 years of experience. By the time industrial-organizational psychologists with a doctorate have 25 or more years of experience in the field, they earn an average salary of $180,985 per year. By comparison, I/O psychologists with a master's degree and 25 or more years of experience reported an average annual salary of $110,333.

Pay by Employment Sector

Industrial-organizational psychologists with doctoral degrees earned the most when they were self-employed consultants -- a median salary of $196,051 per year, as of 2012. By comparison, those who worked for consulting organizations earned a median of $129,496. High-paying industries for I/O psychologists included pharmaceuticals ($172,000), private sector health care ($160,124) and manufacturing ($154,107). Federal government I/O psychologists reported a median salary of $125,000 per year, compared to $117,226 per year for local government psychologists. Two of the lowest-paying sectors were retail ($106,694) and colleges and universities ($104,000).